The economic order quantity (EOQ)(EOQ)ignores:
A)purchasing costs.
B)relevant ordering costs.
C)stockout costs.
D)Both A and C are correct.

Question

Quizplus · Accepted Answer

The EOQ model only considers the cost of holding inventory, ignoring purchasing costs and stockout costs. Relevant ordering costs are considered in the model, but these are often conflated with purchasing costs. So, option D is the correct choice as it accurately reflects the costs that the EOQ model does not take into account.

The Economic Order Quantity (EOQ)(EOQ)ignores